Portion Control: Protecting Your Beverage Profit Margins

Since the sales price of a drink is hinged to the serving portion of alcohol, if the portion size fluctuates, so will the drink's profit margin. Implementing an effective strategy to strictly control portioning is a crucial aspect to protecting your profit margins.

To demonstrate the importance of portioning control, consider the following illustration. According to your bar's policy, a Tanqueray and tonic is prepared with 1 1/4 ounces of the gin (at a cost of $.55 per ounce) and sells at a retail price of $4.50. The Tanqueray and tonic would therefore yield a gross profit of $3.81 ($4.50 - $.69) and sell at a cost percentage of 15.3% ($.69 ÷ $4.50). If, however, a bartender overpours the portion of Tanqueray by a half an ounce, the resulting drink's portion cost will jump 39% (from $.69 to $.96), which in turn will cause the cost percentage to increase a whopping 6%, an increase from 15.3% to 21.3%.

If this same bartender were to nightly overpour 20 drinks by a half a shot, the house would lose approximately 50 ounces of liquor, or nearly a liter and a half over the course of a week. If the average shot of call brand liquor costs $.50 per ounce, this one employee would be responsible for wasting roughly $25 of liquor a week. Were this situation to continue unchecked, the house would lose $1,300 in liquor over a year. Keep in mind that for many high-volume beverage operations limiting losses due to over-portioning to 50 ounces a week would be a considerable improvement.

There is also an opportunity cost associated with over-portioning. In today's society, most people are acutely aware of how much alcohol they can safely consume. They set limits for themselves. Serving potent drinks will have a negative impact on revenue by reducing the number of drinks people can safely order.

In today's society, most people are acutely aware of how much alcohol they can safely consume. They set limits for themselves. Serving potent drinks will have a negative impact on revenue by reducing the number of drinks people can safely order. -- Robert Plotkin

In addition, over-portioning alcohol in drinks places the public at risk and increases an operator's legal liability. The steady rise in alcohol-related litigation practically necessitates that operators implement measures to reduce their exposure to liquor liability.